Handbag sales prompt Coach, Kate Spade to rein in promotions

(Corrects syntax in first paragraph) By Devika Krishna Kumar Jan 29 (Reuters) - Holiday-season splurging on handbags has given Coach Inc and Kate Spade & Co new impetus to cut back on promotions, confident that Americans are more willing to splash out on luxury. Kate Spade announced plans to discontinue its low-margin brand while Coach, its larger competitor, surprised Wall Street by revealing an increase in demand for its high-end handbags. Shares of both companies rose by more than 9 percent. Low gasoline prices and a brighter job market has persuaded many consumers to dig a little deeper into their pockets. U.S. consumer confidence is at its highest in more than seven years, according to a report released this week. "We're encouraged by the green shoots we are seeing in our business," Coach Chief Executive Victor Luis said in a statement announcing December quarter earn...